Islamic Insights

The deteriorating US economy has affected many aspects of the American society today. But few would have thought that the economy would affect sports on a macro level. Prior to the economic downturn, many believed that people would still pay to watch their favorite teams, regardless of the economic situation. But that has not been the case.

Even though many Americans resort to watching sports as a way to relax and get their minds off of personal hardships, Americans haven't been spending as much of their money in that direction anymore. For example, the Detroit Pistons had a sellout streak of over two hundred and fifty plus games, but that streak came to an end this year. Despite their recent successes, the Detroit Red Wings have also failed to sell out all their games this season, which was not an issue earlier this decade. In fact, I went to a conference finals game, and I was surprised by the number of empty seats that stood out at Joe Louis Arena (home of the Red Wings) at a game of such magnitude. Obviously, one would think that a bad economy would have an effect locally with professional teams, but it has also had a major effect on a macro level with league offices.

Out of the four major professional leagues (MLB, NBA, NFL and NHL) the NFL has the largest annual revenue at 6.5 billion dollars. That is an astronomical amount of money flowing into the NFL yearly, but the future of the organization is in limbo. Recently, the NFL released 169 white-collar workers, and Commissioner Roger Goodell took a twenty percent salary cut to save the NFL about two million dollars. This maybe a bump in the road compared what looms in the future.

Currently, NFL owners and the NFLPA (National Football League Players Association) are negotiating on a new collective bargaining agreement. The current collective bargaining agreement expires at the end of the 2010 season. Currently, there is a salary cap at 116.2 million dollars, and a salary floor at 86.4 million dollars. If a collective bargaining agreement is not reached prior to the beginning of the 2010 season, then there will be no salary cap or salary floor. What this means is that if that the economy does not improve by 2010, teams that are already financially stricken will not forced to spend a minimum amount of money on team salaries.

Teams will be able to spend a significantly lower amount than what is already required. If teams do this, then it will result in a domino effect. Teams will be putting a poor product on the field in order to save financially, resulting in fewer fans showing up to games, which in turn will significantly lower the amount of revenue flowing to each team. If enough owners decide to lower team spending, this can definitely lead to a lockout, because players will not be getting their desired contracts and owners will not be willing to spend, meaning no NFL games will be played in 2011.

The NHL (National Hockey League) experienced a lockout, costing it the 2004-2005 season. Ever since, they NHL has struggled to have a consistent flow of revenue, and that is something the NFL could face if they take the same path. NHL owners have spent less as a result of the economy, and marquee players have not received the same financial commitments from owners as they used to. The lack of flow of revenue has fueled the talk of some teams dissolving. Teams in non-hockey towns, especially in the southern US, have experienced a significant decrease in the amount of attendance and an increase in debt. This may force the owners of such teams to either move to cities in the northern US or even into Canada or to fold their teams.

The economy has affected all aspects of the country, even those aspects that many thought would never be affected by a struggling economy. Within the next five years, we could easily see leagues cancelling seasons, franchises moving, and franchises folding, all sadly due to a deteriorating economy.